TaxTMI 
TaxTMI 
2022 (5) TMI 415
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....ssment Order that some of the sub-contractors who were examined have stated that they have not done, any sub-contract work for the assessee company. 3. The Ld. CIT(A) erred in allowing the expenses as mining stock written off. without appreciating the fact that the assessee company has not discharged the onus of substantiating such claim as revenue expenses." 3. We next note with the able assistance of both the parties that the CIT(A) has quashed the impugned assessment itself as not based on any incriminating material found or seized during the course of the search as under : 4. Learned CIT-DIR vehemently contended during the course of hearing that hon'ble jurisdictional high court's decision in Gopal Lal Bhadruka Vs. (2012) DCIT 346 ITR 106 supports the Revenue's case that a search assessment could very well be framed on altogether a new material which sees light of the day in the corresponding proceedings. We find no merit in the Revenue's arguments as their lordships' decision is only applicable in a case wherein the department indeed comes across incriminating material at the time of search than in absence of any such material. We thus place our reliance on the ....
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....roposed to disallow 3.31Cr out of the total sub contract expenses of Rs.41.4Cr and add it back to the retuned income. 4.2 During the course of appellate proceedings, AR contended as under: On a perusal of the Assessment Order, it is an undisputed fact that your appellant has executed the work, produced all the details and also substantiated the expenditure by submitting the bills given to the principal contractor and that they have received money from the Government. However, the Assessing Officer without rejecting the books or bringing on record any incriminating material, on the second page towards to end has stated that "it cannot be ruled out completely that the Assessee was not indulged in inflating the expenditure ---â€, on mere assumption there could not be disallowance of expenditure or addition. The Jodhpur ITAT in the case of Smt. Jiya Devi Sharma Vs ACIT[2015] 68 SOT 57 (Jodhpur Trib.) at para 3.3 has held as under: 3.3 Before us, similar arguments were reiterated by both the sides. We have found that the assessee had produced complete books of account before the A.O. Details of land development expenses incurred were eve....
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....owards unabated assessments are permissible only where incriminating materials are found in search showing unaccounted income." The para 15.3 to 15.3.6 are reproduced for your perusal: 15.3 The scope of assessment under s. 153A of the Act in respect of concluded and unabated assessment is thus narrower in its sweep as held in long line of judicial precedents of different jurisdictions. 15.3.1 We shall first refer to the decision of Hon'ble Delhi High court in the case of Meeta Gutgutia (supra) The Hon'ble Delhi High Court referred to the judgment in the case of Kabul Chawla (supra) Pr.CIT v. Saumya Construction (P.) Ltd. [2017] 81 taxmann.com 292/[2016] 387 ITR 529 (Guj); Dr. CIT v. Devangi alias Rupa [2017] 88 taxmann.com 610/394 ITR 184 (Guj.);CIT v. IBC Knowledge Park (P.) Ltd. [2016] 69 taxmann.com 108/385 ITR 346 (Kar.); Pr. CIT-2 v. Salasar Stock Broking Ltd. [ITAT No. 264 of 2016, dated 24-8-2016] and CIT v. Gurinder Singh Bawa [2017] 79 taxmann.com 398/[2016] 386 ITR 483 (Bom.), Reference was also made to another two decisions of Hon'ble Delhi Court in Pr. CIT v. Mahesh Kumar Gupta [IT Appeal No. 810 of 2016, dated 22-11-2016]....
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.....w.s. 158BB of the Act and consequently, the plea of the Revenue that there is no condition in section 153A of the Act that additions should be made strictly on the basis of evidence found during the course of search was not approved. The Hon'ble Gujarat High Court analyzed the position of law and took note of several judicial precedents and concluded that completed assessments can be interfered with by the AO while making the assessment under s.153A of the Act only on the basis of some incriminating material unearthed during the course of search or requisition of documents etc. The Hon'ble Gujarat High Court noted that the trigger point for exercise of powers under s.153A of the Act is a search under s.132 of the Act or a requisition under s.132A of the Act. Once a search or requisition is made, the mandate is cast upon the AO to issue notice under s.153A of the Act and complete the assessment of 6 assessment years. The Hon'ble Gujarat High Court took note of the fact that object of scheme legislated for assessment in search cases is to bring to tax the undisclosed income which is found during the of to search therefore pursuan....